KLCI Stock - TGOFFS / 7228 - 2010 Quarter 2

Market Cap : 291754440*1.57 = 458,054,470.80 (Small)
NTA per share : (329195-9625)/264025 = 1.21
P/BV : 1.57/1.21 = 1.2975
Forecast P/E now : 1.57/0.0546 = 28.75 (High)
ROE : Negative
DY : Not applicable
Fixed Asset Turnover(3 year) : (0.5198+0.7656+0.6416)/3 = 0.6423 (Low)
Liquidity Ratio : 275155/211720 = 1.2996 (Low)
Receivables Collection Period : (242535+243567)/2/(555683/365) = 159 days (Bad)
My Target Price : Not interested unless revenue and profit increase more
My Decision : NOT BUY
My Comment : Revenue and profit increased but remain low, bad cash flow, remain high debt but slightly decreasing, navps same, oil sector growing, gas sector dropping
Technical Support Price : 1.6, 1.5
Risk Rating : HIGH
OSK Target Price : 1.73 (11 Oct 10)

My notes based on 2010 quarter 2 report (number in '000):-

- For the current quarter ended 30 June 2010, the Group recorded a decrease of consolidated revenue of 20.0% as compared to the corresponding quarter ended 31 March 2009. The net profit
after tax recorded for the current quarter ended 30 June 2010 is 4.36% lower than that recorded in the corresponding quarter ended 30 June 2009

- During the quarter under review, the Group recorded lower revenue as compared to the preceding year quarter due to the completion of engineering equipment contracts for the following subsidiaries namely, Citech Energy Recovery Systems UK Limited (CERS), Tanjung CSI Sdn Bhd and Tanjung Offshore Services Sdn Bhd (TOS) during Quarter 1, 2010. Apart from the completion of engineering equipment contracts, MV Tanjung Gelang has also completed its long term charter to Carigali PTTEPI Operating Company (CPOC) at the end of Quarter 1, 2010. The Group is currently in the midst of securing a new charter contract for the said vessel

- Notwithstanding the Group’s lower revenue, the Group registered a slightly higher profit after tax due to the management’s conscious efforts to reduce operating costs at all levels within the Group’s operations

- The Group’s total revenue for the current quarter represents an increase of 7.53% as compared to the preceding quarter ended 31 March 2010. The Group’s consolidated net profits registered in the current quarter represents a slight increase in earnings as compared to the preceding quarter. The Groups profitability is slightly higher in the current quarter under review due to cost reduction measures in all level of operations earlier this year

- Estimate next 4Q eps after 2010 Q2 result announced = 0.0124*4*1.1 = 0.0546, estimate PE on current price 1.57 = 28.75
- Estimate next 4Q eps after 2010 Q1 result announced = 0.0119*4*1.1 = 0.0524, estimate highest/lowest PE = 38.55/20.42
- Estimate next 4Q eps after 2009 Q4 result announced = 0.0096*4 = 0.0384-(0.0384*0.1) = 0.0346, estimate highest/lowest PE = 35.84/28.76

TGOFFS latest news (English)